Friday, May 18, 2012

Latest HY market statistics

As discussed earlier, the high yield market is growing in spite of the uncertainties around global growth. The charts below provide the latest statistics on the market.

Institutional leveraged loans issuance continues to exceed HY bond issuance as demand for product from CLOs stays strong.

Source: Fitch (click to enlarge)

The use of proceeds is dominated by refinancing activities, capex, and other corporate expenses. M&A and LBO activity is still subdued.

Source: Fitch (click to enlarge)

The overall market is now around $1.1 trillion dollars.

Source: Fitch (click to enlarge)

A pause in growth should be expected as the Eurozone mess flares up. With rates at historical lows however, demand will continue to stay strong. New issuance will likely clear the market at somewhat more reasonable spreads than the frothy transactions we've had recently.
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